Bank customers shell out £650m in penalty fees in a year as they struggle to keep on top of numerous accounts

Bank customers have collectively paid nearly £650million in penalty fees on credit cards and bank accounts in the past year, research has claimed.

And in the last three months, 1.9million people have incurred a late payment fee or unauthorised overdraft charge, a 29 per cent increase on the previous period, according to new finance management service OnTrees.com.

It comes as a quarter of people now have current accounts with more than one provider the research states, while more than three million have a savings account and credit card with different providers. It argues that this confusion is driving the increase in shock charges.

Minefield: Three million have a current account, savings account and credit card with different providers, causing financial confusion

It comes as savers constantly have to switch to take advantage of top rate deals, while banks and building societies have attempted to reel-in custom with various perks - such as cash 'bribes' - to change current accounts.

As a result, 27 per cent can’t remember all the providers they bank with and over a third can’t recall the balance of their current account.

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The OnTrees service, launched today by This is Money's parent group Associated Newspapers after extensive testing with forum Mumsnet and NUS members, aims to help people keep on top of their finances.

It says that until now, there has been no way for people to access all of their accounts in one place with real-time updates via their smartphones and desktop PC.

The service is free and offers a ‘bank level’ security system used by major financial institutions.

Customers are able to link to any current account, savings product or credit card across the globe.

With one log-in, users can track recent transactions across their accounts, see a breakdown of their spending and set up budgets and alerts to manage money more effectively.

OnTrees: The service is aiming to help customers keep on touch of their finances in one place

Charlie Mortimer of OnTrees says: ‘In the US, personal finance managers like OnTrees are used by more than 10million people, but no product offered UK consumers the level of security and range of functionality that they were looking for.

‘In a market where people are using a wealth of different products, it makes sense to enable them to take control of their financial lives.’

The trial with Mumsnet was a huge success, with three quarters of those who used the service saying they would recommend it to a friend.

Justine Roberts, founder of Mumsnet.com said: ‘Mumsnetters who took part in the trial especially liked having all balances available in one place and being able to track transactions. The budgeting tool also went down well.’